BILL NUMBER: AB 1381	CHAPTERED  10/10/99

	CHAPTER   871
	FILED WITH SECRETARY OF STATE   OCTOBER 10, 1999
	APPROVED BY GOVERNOR   OCTOBER 8, 1999
	PASSED THE ASSEMBLY   SEPTEMBER 3, 1999
	PASSED THE SENATE   AUGUST 31, 1999
	AMENDED IN SENATE   AUGUST 25, 1999
	AMENDED IN SENATE   AUGUST 17, 1999
	AMENDED IN SENATE   JULY 7, 1999
	AMENDED IN SENATE   JUNE 30, 1999
	AMENDED IN ASSEMBLY   MAY 19, 1999

INTRODUCED BY   Assembly Member Steinberg
   (Coauthor:  Assembly Member Cox)

                        FEBRUARY 26, 1999

   An act to amend Sections 36615, 36621, 36623, 36631, 36633, 36635,
36641, 36642, 36650, and 36651 of, to amend and renumber Section
36626 of, to repeal Sections 36624, 36626.5, 36626.6, and 36626.7 of,
to repeal and add Sections 36625 and 36627 of, and to add Section
36626 to, the Streets and Highways Code, relating to improvement
districts.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 1381, Steinberg.  Property and Business Improvement District
Law of 1994:  benefits assessments.
   (1) Article XIIID of the California Constitution, which was added
pursuant to the approval by the voters of Proposition 218 at the
November 5, 1996, general election, generally requires a specified
written notice and the holding of a public hearing for new or
increased assessments, fees, and charges and, under certain
circumstances, requires approval by the property owners.  The
Proposition 218 Omnibus Implementation Act prescribes specific
procedures and parameters for local jurisdictions in complying with
Article XIIID of the California Constitution.
   The Property and Business Improvement District Law of 1994
authorizes cities to form property and business improvement districts
for the purpose of levying assessments within a business improvement
area.
   This bill would reorganize those provisions to require a written
notice and a public hearing, as specified in the Proposition 218
Omnibus Implementation Act.
   (2) Existing law requires a city council, before adopting a
resolution establishing a district, to appoint an advisory board to
make recommendations and reports concerning the levying of
assessments, as specified.
   This bill, in addition and among other things, would provide that
the first report is due after the first year of operation of the
district.
   (3) Existing law, upon the written request of the advisory board,
authorizes the city council to modify the management district plan by
adopting a resolution after holding hearings on the proposed
modification, as specified.
   This bill instead would require one public hearing to be held
prior to adopting the resolution.  The bill also would require the
city council, if the modification includes the levy of a new or
increased assessment, to comply with specified provisions of the
Government Code relating to notice, protest, and hearing
requirements.
   (4) Existing law prohibits the city council from changing the
boundaries of the district to include any territory that will not, in
its judgment, benefit by the improvement or activity.  Additions of
territory to the proposed boundaries of the district are prohibited
unless notice has been provided to the owners of the property
proposed to be added to the district, as specified.
   This bill would delete those prohibitions.
   (5) Existing law requires the city council to adopt a resolution
of intention that states the proposed modification prior to the
public hearing which is required to be held not more than 60 days
after the adoption of the resolution of intent.
   This bill instead would require the public hearing to be held not
more than 90 days after the adoption of the resolution of intent.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 36615 of the Streets and Highways Code is
amended to read:
   36615.  "Property owner" or "owner" means any person shown as the
owner of land on the last equalized assessment roll or otherwise
known to be the owner of land by the city council.  The city council
has no obligation to obtain other information as to the ownership of
land, and its determination of ownership shall be final and
conclusive for the purposes of this part.  Wherever this subdivision
requires the signature of the property owner, the signature of the
authorized agent of the property owner shall be sufficient.
  SEC. 2.  Section 36621 of the Streets and Highways Code is amended
to read:
   36621.  (a) Upon the submission of a written petition, signed by
the property owners in the proposed district who will pay more than
50 percent of the assessments proposed to be levied, the city council
may initiate proceedings to form a district by the adoption of a
resolution expressing its intention to form a district.  The amount
of assessment attributable to property owned by the same property
owner that is in excess of 40 percent of the amount of all
assessments proposed to be levied, shall not be included in
determining whether the petition is signed by property owners who
will pay more than 50 percent of the total amount of assessments
proposed to be levied.
   (b) The petition of property owners required under subdivision (a)
shall include a summary of the management district plan.  That
summary shall include all of the following:
   (1) A map showing the boundaries of the district.
   (2) Information specifying where the complete management district
plan can be obtained.
   (3) Information specifying that the complete management district
plan shall be furnished upon request.
   (c) The resolution of intention described in subdivision (a) shall
contain all of the following:
   (1) A brief description of the proposed activities and
improvements, the amount of the proposed assessment, and a
description of the exterior boundaries of the proposed district.  The
descriptions do not need to be detailed and shall be sufficient if
they enable an owner to generally identify the nature and extent of
the improvements and activities and the location and extent of the
proposed district.
   (2) A time and place for a public hearing on the establishment of
the property and business improvement district and the levy of
assessments, which shall not be held more than 90 days after the
adoption of the resolution of intention.
  SEC. 3.  Section 36623 of the Streets and Highways Code is amended
to read:
   36623.  If a city council proposes to levy a new or increased
benefit assessment, the notice and protest and hearing procedure
shall comply with Section 53753 of the Government Code.
  SEC. 4.  Section 36624 of the Streets and Highways Code is
repealed.
  SEC. 5.  Section 36625 of the Streets and Highways Code is
repealed.
  SEC. 6.  Section 36625 is added to the Streets and Highways Code,
to read:
   36625.  (a) If the city council, following the public hearing,
decides to establish the proposed property and business improvement
district, and the city council has made changes pursuant to Section
36624, and the changes substantially change the proposed assessment,
the city council shall adopt a resolution of preliminary adoption
that shall contain all of the following:
   (1) A brief description of the proposed activities and
improvements, the amount of the proposed assessment, and a
description of the exterior boundaries of the proposed district.  The
descriptions do not need to be detailed and shall be sufficient if
they enable an owner to generally identify the nature and extent of
the improvements and activities and the location and extent of the
proposed district.
   (2) The number, date of adoption, and title of the resolution of
intention.
   (3) The time and place where the public hearing was held
concerning the establishment of the district.
   (4) A determination regarding any protests received.
   (5) A statement that the properties in the district established by
the resolution shall be subject to any amendments to this part.
   (6) A statement that the improvements and activities to be
provided in the district will be funded by the levy of the
assessments.  The revenue from the levy of assessments within a
district shall not be used to provide improvements or activities
outside the district or for any purpose other than the purposes
specified in the resolution of intention, as modified by the city
council at the hearing concerning establishment of the district.
   (7) A finding that the property within the business and
improvement area will be benefited by the improvements and activities
funded by the assessments proposed to be levied.
   (b) Not earlier than 30 days after the resolution of preliminary
adoption, if the city council decides to establish the proposed
property and business  improvement district, the council shall
consider all written protests.  If written protests are received from
property owners in the proposed district who pay 50 percent or more
of the assessments proposed to be levied and protests are not
withdrawn so as to reduce the protests to less than that 50 percent,
the proceedings to create the proposed district shall be terminated.

   (c) If not required to terminate the proceedings in compliance
with subdivision (b), the city council shall adopt a resolution
consistent with the resolution of preliminary adoption.  The adoption
of the resolution and recordation of the notice and map pursuant to
Section 36627 shall constitute the levy of an assessment in each of
the fiscal years referred to in the management district plan.  The
resolution shall contain all of the following:
   (1) A brief description of the proposed activities and
improvements, the amount of the proposed assessment, and a
description of the exterior boundaries of the proposed district.  The
descriptions do not need to be detailed and shall be sufficient if
they enable an owner to generally identify the nature and extent of
the improvements and activities and the location and extent of the
proposed district.
   (2) The number, date of adoption, and title of the resolution of
intention and resolution of preliminary adoption.
   (3) The time and place where the public hearing was held
concerning the establishment of the district.
   (4) A determination regarding any protests received.
   (5) A statement that a property and business improvement district
has been established.
   (6) A statement that the properties in the district established by
the resolution shall be subject to any amendments to this part.
   (7) A statement that the improvements and activities to be
provided in the district will be funded by the levy of the
assessments.  The revenue from the levy of assessments within a
district shall not be used to provide improvements or activities
outside the district or for any purpose other than the purposes
specified in the resolution of intention, as modified by the city
council at the hearing concerning establishment of the district.
   (8) A finding that the property within the property and business
improvement district will be benefited by the improvements and
activities funded by the assessments proposed to be levied.
  SEC. 7.  Section 36626 of the Streets and Highways Code is amended
and renumbered to read:
   36624.  At the conclusion of the public hearing to establish the
district, the city council may adopt, revise, change, reduce, or
modify the proposed assessment or the type or types of improvements
and activities to be funded with the revenues from the assessments.
Proposed assessments may only be revised by reducing any or all of
them.  At the public hearing, the city council may only make changes
in, to, or from the boundaries of the proposed property and business
improvement district that will exclude territory that will not
benefit from the proposed improvements or activities.  Any
modifications, revisions, reductions, or changes to the proposed
assessment district shall be reflected in the notice and map recorded
pursuant to Section 36627.
  SEC. 8.  Section 36626 is added to the Streets and Highways Code,
to read:
   36626.  If the city council, following the public hearing, desires
to establish the proposed property and business improvement
district, and the city council has not made changes pursuant to
Section 36624, or has made changes that do not substantially change
the proposed assessment, the city council shall adopt a resolution
establishing the district.  The resolution shall contain all of the
information specified in paragraphs (1) to (8), inclusive, of
subdivision (b) of Section 36625, but need not contain information
about the preliminary resolution if none has been adopted.
  SEC. 9.  Section 36626.5 of the Streets and Highways Code is
repealed.
  SEC. 10.  Section 36626.6 of the Streets and Highways Code is
repealed.
  SEC. 11.  Section 36626.7 of the Streets and Highways Code is
repealed.
  SEC. 12.  Section 36627 of the Streets and Highways Code is
repealed.
  SEC. 13.  Section 36627 is added to the Streets and Highways Code,
to read:
   36627.  Following adoption of the resolution establishing the
district pursuant to Section 36625 or 36626, the clerk of the city
shall record a notice and an assessment diagram pursuant to Section
3114.  No other provision of Division 4.5 (commencing with Section
3100) applies to an assessment district created pursuant to this
part.
  SEC. 14.  Section 36631 of the Streets and Highways Code is amended
to read:
   36631.  (a) Before adopting a resolution establishing the
district, the city council shall appoint an advisory board which
shall make a recommendation to the city council on the expenditure of
revenues derived from the levy of assessments pursuant to this part,
on the classification of properties, as applicable, and on the
method and basis of levying the assessments.  The city council may
designate existing advisory boards or commissions to serve as the
advisory board for the district or may create a new advisory board
for that purpose.  At least one member of the advisory board shall be
a business licensee within the district who is not also a property
owner within the district.
   (b) Any advisory board appointed by the city council pursuant to
subdivision (a) shall comply with the provisions of the Ralph M.
Brown Act (Chapter 9 (commencing with Section 54950) of Part 1 of
Division 2 of Title 5 of the Government Code).
  SEC. 15.  Section 36633 of the Streets and Highways Code is amended
to read:
   36633.  (a) The advisory board shall cause to be prepared a report
for each fiscal year, except the first year, for which assessments
are to be levied and collected to pay the costs of the improvements
and activities described in the report.  The advisory board's first
report shall be due after the first year of operation of the
district.  The report may propose changes, including, but not limited
to, the boundaries of the property and business improvement district
or any benefit zones within the district, the basis and method of
levying the assessments, and any changes in the classification of
property, if a classification is used.
   (b) The report shall be filed with the clerk and shall refer to
the property and business improvement district by name, specify the
fiscal year to which the report applies, and, with respect to that
fiscal year, shall contain all of the following information:
   (1) Any proposed changes in the boundaries of the property and
business improvement district or in any benefit zones within the
district.
   (2) The improvements and activities to be provided for that fiscal
year.
   (3) An estimate of the cost of providing the improvements and the
activities for that fiscal year.
   (4) The method and basis of levying the assessment in sufficient
detail to allow each real property owner to estimate the amount of
the assessment to be levied against his or her property for that
fiscal year.
   (5) The amount of any surplus or deficit revenues to be carried
over from a previous fiscal year.
   (6) The amount of any contributions to be made from sources other
than assessments levied pursuant to this part.
   (c) The city council may approve the report as filed by the
advisory board or may modify any particular contained in the report
and approve it as modified.  Any modification shall be made pursuant
to Sections 36640 and 36641.  The city council shall not approve a
change in the basis and method of levying assessments that would
impair an authorized or executed contract to be paid from the
revenues derived from the levy of assessments.
  SEC. 16.  Section 36635 of the Streets and Highways Code is amended
to read:
   36635.  The validity of an assessment levied under this part shall
not be contested in any action or proceeding unless the action or
proceeding is commenced within 30 days after the resolution levying
the assessment is adopted pursuant to Section 36626.  Any appeal from
a final judgment in an action or proceeding shall be perfected
within 30 days after the entry of judgment.
  SEC. 17.  Section 36641 of the Streets and Highways Code is amended
to read:
   36641.  (a) Upon the written request of the advisory board, the
city council may modify the management district plan  after
conducting one public hearing on the proposed modifications.  If the
modification includes the levy of a new or increased assessment, the
city council shall comply with Section 53753 of the Government Code.

   (b) The city council shall adopt a resolution of intention which
states the proposed modification prior to the public hearing required
by this section.  The public hearing shall be held not more than 90
days after the adoption of the resolution of intention.
  SEC. 18.  Section 36642 of the Streets and Highways Code is amended
to read:
   36642.  The city council may modify the improvements and
activities to be funded with the revenue derived from the levy of the
assessments by adopting a resolution determining to make the
modifications after holding a public hearing on the proposed
modifications.  Notice of the public hearing and the proposed
modifications shall be published as provided in Section 36623.
  SEC. 19.  Section 36650 of the Streets and Highways Code is amended
to read:
   36650.  (a) Any district established or extended pursuant to the
provisions of this part, where there is no indebtedness, outstanding
and unpaid, incurred to accomplish any of the purposes of the
district, may be disestablished by resolution by the city council in
either of the following circumstances:
   (1) If the city council finds there has been misappropriation of
funds, malfeasance, or a violation of law in connection with the
management of the district, it shall notice a hearing on
disestablishment.
   (2) During the operation of the district, there shall be a 30-day
period each year in which assessees may request disestablishment of
the district.  The first such period shall begin one year after the
date of establishment of the district and shall continue for 30 days.
  The next such 30-day period shall begin two years after the date of
the establishment of the district.  Each successive year of
operation of the district shall have such a 30-day period.  Upon the
written petition of the owners of real property in the area who pay
50 percent or more of the assessments levied, the city council shall
pass a resolution of intention to disestablish the district.   The
city council shall notice a hearing on disestablishment.
   (b) The city council shall adopt a resolution of intention to
disestablish the district prior to the public hearing required by
this section.  The resolution shall state the reason for the
disestablishment, shall state the time and place of the public
hearing, and shall contain a proposal to dispose of any assets
acquired with the revenues of the assessments levied within the
property and business improvement district.  The notice of the
hearing on disestablishment required by this section shall be given
by mail to the property owner of each parcel in the district.  The
city shall conduct the public hearing not less than 30 days after
mailing the notice to the property owners.  The public hearing shall
be held not more than 60 days after the adoption of the resolution of
intention.
  SEC. 20.  Section 36651 of the Streets and Highways Code is amended
to read:
   36651.  (a) Upon the disestablishment of a district, any remaining
revenues derived from the levy of assessments, or any revenues
derived from the sale of assets acquired with the revenues, shall be
refunded to the owners of the property then located and operating
within the  district in which assessments were levied by applying the
same method and basis that was used to calculate the assessments
levied in the fiscal year in which the district is disestablished.
   (b) If the disestablishment occurs before an assessment is levied
for the fiscal year, the method and basis that was used to calculate
the assessments levied in the immediate prior fiscal year shall be
used to calculate the amount of any refund.
